Dentalcorp Holdings Ltd. Sold: Investment & Tax Planning Guide

Question: How is my Dentalcorp Holdings Ltd. practice sale taxed as a healthcare professional?

Answer: Healthcare practice sales have specific tax considerations. If you operate through a professional corporation, LCGE eligibility depends on meeting the qualified small business corporation (QSBC) tests—including that 90%+ of assets are used in active business. Goodwill related to your personal practice reputation may require careful structuring. For a $2.2B transaction, expect to pay capital gains tax on proceeds above your LCGE room (2026 LCGE: $1,016,836). Professional corporations may have additional tax planning opportunities through salary/dividend optimization in your final year of practice.

Question: Do I qualify for the Lifetime Capital Gains Exemption on my Dentalcorp Holdings Ltd. shares?

Answer: LCGE eligibility requires your shares to be "qualified small business corporation" (QSBC) shares. Tests include: (1) Canadian-controlled private corporation at sale; (2) 90%+ of assets used in active business in Canada at sale; (3) 50%+ active business asset test met for 24 months pre-sale; (4) You (or related person) held shares since issuance. Private equity deal structures may include provisions affecting QSBC status—review carefully. Professional verification is essential—errors result in six-figure tax bills.

Question: How should I invest my $2.2B business sale proceeds?

Answer: Large liquidity events require sophisticated planning. Immediate priorities: (1) Park proceeds in high-interest savings while planning—don't rush; (2) Assemble your team: tax accountant experienced with business sales, estate lawyer, wealth manager with experience in significant portfolios; (3) Structure decisions first: holding company vs. personal, RRSP contribution room, tax installment requirements. Investment deployment should be gradual—consider 12-24 months for full equity allocation. Diversification across asset classes, geographies, and managers reduces concentration risk. For proceeds of this magnitude, expect to pay 0.5-1% annually for comprehensive wealth management—but the value in tax optimization, behavioral coaching, and estate planning typically exceeds the cost.

Question: Should I roll equity into GTCR LLC's fund/holding company?

Answer: Private equity firms often offer sellers the chance to "roll" some proceeds into equity in the newly acquired company. Considerations: (1) Concentration risk—you're re-investing in the same business you just sold; (2) Illiquidity—PE investments typically lock up capital for 5-7 years until exit; (3) Potential upside—PE firms aim for 2-3x returns, so rollover equity can be valuable if the thesis works; (4) Tax efficiency—rollovers may defer capital gains. If offered rollover, evaluate the PE firm's track record, the specific value creation plan, and your overall portfolio allocation. Most advisors suggest limiting rollover to 10-20% of total proceeds to balance upside potential against concentration risk.

Question: Should I keep my Dentalcorp Holdings Ltd. proceeds in a corporation or take them personally?

Answer: This decision involves trade-offs. Corporate advantages: lower tax rates on investment income (creates deferral), creditor protection, estate planning flexibility, ability to income split with family shareholders. Personal advantages: simplicity, access to TFSA/RRSP contribution room, principal residence exemption for real estate purchases, no ongoing corporate maintenance costs. The "integration" principle means you'll eventually pay similar total tax either way—corporate structures primarily offer timing control and creditor protection. For proceeds of this magnitude, many business sellers use a hybrid: extract enough for immediate needs and registered account contributions, leave the balance in a holding company. Decision should be made with tax and legal professionals.

Question: What estate planning changes should I make after selling Dentalcorp Holdings Ltd.?

Answer: A major liquidity event requires immediate estate planning updates. Within 90 days: (1) Update your will to reflect new liquid assets—trusts may now be appropriate for wealth this significant; (2) Review all beneficiary designations (RRSP, TFSA, insurance, corporate accounts); (3) Update powers of attorney to reflect new financial complexity; (4) Review insurance needs—you may need less life insurance but more liability coverage; (5) If you established a holding company, ensure share structure supports estate planning goals (estate freeze, family trusts). For families with significant wealth, consider family governance discussions—sudden wealth creates dynamics that are better addressed proactively.